TORONTO -- "Loot boxes." Until recently, the only people likely to have heard of them were gamers. But loot boxes and other similar microtransactions in games are earning the industry billions of dollars, and they're now generating a new controversy in the mainstream.
They're small, scintillating boxes in video games that, when opened, give a slew of random items that vary in rarity and, by extension, in-game value. They were first seen in free-to-play mobile games like "Candy Crush" before they were adopted into the business model of games for which players have already paid. The problem, critics say, is that loot boxes, which can be bought with real money by players looking to get new items, look an awful lot like gambling.
Belgium and the Netherlands have recently passed laws declaring certain loot boxes illegal gambling, and the concern has spread to some senators in the States, although there's currently no legislation in Canada.
For the video game industry, loot boxes are an additional way to monetize gameplay. Activision Blizzard, the creator of franchises like "Call of Duty" and "World of Warcraft," made $4.7 billion in revenue from in-game content, which includes loot boxes as well as other microtransactions, last year alone.
Zoe Landon, who records herself playing games on Twitch, a popular live streaming website, says that while she has no problem with loot boxes that can be earned through play, paying for them is a different matter. She says loot boxes are designed to be as enticing as possible to players.
"I think of things like "Overwatch" or "Quake Champions" where there's a flashy animation and a ta-da kind of music when you open it. So that encourages the activity, psychologically."
Landon points to streamers on Twitch who collect a heap of loot boxes -- 50, 100, sometimes more -- and open them in a row. The satisfaction of loot boxes comes not only from winning an item but the "spectacle" of simply opening them, Landon says. Some of these videos have thousands of views.
"(Loot boxes you can buy) are considered generally the most controversial because you are essentially paying money for a chance at something. That does sound very much like gambling."
Jayson Hilchie, the president and CEO of the , disagrees. He says there are clear differences between the two activities.
"In-game transactions are not gambling because you can't take them out of the game ... There's no opportunity for you to make money in the real world." He adds that because loot boxes always guarantee something -- although perhaps not the item players are hoping for -- they don't fit the criteria for gambling.
Lisa Pont, a therapist with clinical experience in problematic video game use, is less worried about the legal definition of loot boxes, and more worried about the effect it might have on players, especially young people.
"People are concerned it could actually be priming young people for gambling. That you get used to having those kinds of microtransactions online and it perhaps makes you more comfortable with that kind of interactivity," she says.
The psychological effects of video games have been increasingly scrutinized in recent years, the most dramatic result of which has been the World Health Organization's classification on Monday of compulsive video game play as a new mental health condition.
While the -- what Pont terms North America's "psychiatric bible" -- continues to list "Internet Gaming Disorder" as a condition warranting further study, she says it is nevertheless significant that it's there at all.
But as the medical and legal conversations surrounding video games continue, Hilchie is quick to show that game companies have begun to make their own changes.
He says that the Entertainment Software Rating Board, a self-regulatory organization of the video game industry responsible for rating the age-appropriateness of games, recently released a new rating indicator for all games that include loot boxes and other microtransactions.
Video game companies have also begun releasing the odds of loot boxes in an effort to be more transparent. The move is in line with a new Chinese law making it mandatory for games to release the odds of getting certain items in a box.
At this year's E3, a video game expo in Los Angeles, it was clear that the landscape of loot boxes is changing, albeit slowly.
"Anthem," a game from Electronic Arts scheduled to be released next year, will allow players to purchase items directly, but randomized loot boxes will not be available. Still, players can continue to buy them in popular games like "Overwatch," "PlayerUnknown's Battlegrounds" and others.
Reggie Fils-Aime, president and chief operating officer of Nintendo of America, says Nintendo's mobile game "Animal Crossing: Pocket Camp" uses loot boxes, but there are other ways for players to access certain in-game mechanics.
Loot boxes become problematic if they're the only way for players to access items that are foundational to the game, he said last week in a phone interview during E3.
But "that's bad gameplay design," he argues.
"I think you have to be really careful when you talk about a particular gameplay mechanic and try to characterize how it could be used and what's its role. The core concept of spending money in an experience and not knowing exactly what you're going to get is as old as baseball cards."
-- With files from Curtis Withers
